When I choose "restore previous file versions" from the system restore shadow copy it to the desktop or just simple restore it freezes my whole system. I was trying to figure out the issue and disabled NOD32 to see if that was the issue. Once I disabled my file versions restored in an instant!

I've been having this problem as well. It has happened through every version since vista was released. I just tried it out with 3.0.650.0 and the same thing. This problem happens on a brand new unmodified vista install and on x86 or x64.